A Product Has a Contribution Margin of $2

question 23

Multiple Choice

A product has a contribution margin of $2.50 per unit and a selling price of $25 per unit.Fixed costs are $20,000.Assuming new technology increases the unit contribution margin by 50 percent but increases total fixed costs by $13,750,what is the new break-even point in units?

• A) 3,667 units
• B) 3,333 units
• C) 13,500 units
• D) 9,000 units

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Definitions:

Kruskal-Wallis Test

A nonparametric method for testing whether samples originate from the same distribution, an extension of the Mann-Whitney U test to multiple groups.

Alternative Hypothesis

A statement that contradicts the null hypothesis, suggesting that there is a significant effect or difference.

Population Locations

General or specific areas where members of a defined population reside or are positioned.

Kruskal-Wallis Test

A non-parametric method used for comparing more than two samples that are independent, or not related.